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tv   Worldwide Exchange  CNBC  June 17, 2014 4:00am-6:01am EDT

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welcome to "worldwide exchange." i'm jewel ka chatterley. these are your headlines from around the world. the international energy agency lowers its outlook for iraqi oil production as violence spread. but the ceo of bp tells use he's not worried about the company's operations in iraq. >> bp's assets are a long way from the troubles being increased in response by requests from the government and will continue to operate. >> bp and shell set to win big
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deals with china. the oil major is expected to unveil mostly billion ton deals to supply staff to china. mitsubishi launch their takeover proposals for the firm. the french president prepares to meet the ceos of the two firms in a few minutes. and another recall for gm. the troubled automaker takes another 3.5 million cars off the road for faulty ignition switches. >> you're watching "worldwide exchange," bringing you business news from around the globe. >> welcome, again, to "worldwide exchange." let's get straight to our top story today. american troops are going back into iraq. the white house announced it's deploying up to 275 million personnel to provide security to the embassy in baghdad and other u.s. interests in the country. the iraqi military has so far
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managed to curtail the sunni rebelled pushed towards baghdad with continuing to consolidate their strong hold on the northwest of the country. the u.s. says it's open to iran over what measures it can take. john kerry said discussions did not include military operations. >> we're open to discussions, say, if there's something constructive that could be contributed by iran, if iran is prepared to do something that is going to respect the integrity and sovereignty of iraq and the ability of the government to reform. >> joining us now is sir william patey, former ambassador to iraq. it feels like president obama spent the last few years trying to disentangle himself as far as foreign policy in the region. can he look at the troops being
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called back in here? >> i don't think. i think that small number of troops is to enhance production in the u.s. it gives him an option of reintroducing usair craft into iraq in the short-term. i don't think there's any appetite for u.s. military engagement and i think both president obama and others have made that clear. >> some of the uk leaders picked up on this idea that perhaps we could see an improvement in the relationship between iran and the west. both sides right now saying there's not going to be any coordination as far as involvement in iraq is concerned. >> i think direct military cooperation between the u.s. and iran would be a big step. i guess the back drop of a possibility of a nouk here deal, there is the prospect of a u.s. and iran sharing short-term interests in iraq. they both have something to feet from isis setting up in iraq.
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so they would have interests. i suspect what we'll see is americans coordinating with the iraqis and the iraqis coordinating with the iranians, so it may be coordination arms led through the iraqs. >> what's the best outcome here? >> the iraqi army gets its act together with help from the international community and it's able to hold back isis and retake part of the territory. but that will only work if they have a political plan to bring sunnis back into the process. i think the reason isis has had this opportunity is because the city majority have been alien ated, the sunnis in the majority areas have been ail alienated. >> 250,000 iraqi military personnel. admittedly, there are many factions we've seen over the last few days. but given the sheer size of
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those numbers, i think it's the lack of coordination at the top that's preventing any decent sized push back on this. >> i think we see pushback. the problem as we may see it is the -- in that there are longer term problems for iraq. when i left iraq in 2006 as ambassador, they were still active and threat threatened the break-up of iraq. once you've reformed the militias, they may be more difficult to put back in their box. it will be difficult for isis in the long-term p to hold on to that. >> i think the military will be disappointed, to say the least, but i think it's really down to
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the iraqis. i don't think everything that happened since 2003 can be blamed on the u.s. >> saudi arabia said they were against any kind of foreign intervention in the situation. why don't countries like iran, like turkey, like saudi arabia step in here to stop the situation? >> i don't think it's capable. i think this is basically an iraqi problem that has to be solved. now, it can be helped or hindered by international fears or international systems. it's essentially an iraqi problem. i think the iranians can help, the saudis can help by supporting moderate sunnis and helping them into the political process. the saudis have been a huge disappointment to isis. >> if it has to be a domestic
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solution to the problem, how long does this drag out? >> i think it's not capable of a quick solution now. obviously the military will take some time to recover the ground. >> so just keep our views with other issues, of course. the international energy agency has warned all those targets are looking increasingly at risk. the iea cut its outlook for oil production to 4.5 million barrels per day by 2019. however, the agency did say that global demand growth would begin to slow by tend of the decade partly due to higher prices. we've got trading slidely lower in the session today after the gains we've seen in the last few sessions, oil off by 0.4%. breaking news from gazprom
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this morning saying gas supply to ukraine are stable. they completely stopped the flow yesterday from ukraine. ukraine won't be receive anything gas from russia unless it pays in advance after it failed to meet the deadline payment yesterday. the head of the ukraine state and gas company says the country has supplies that could last until december and it is working to reverse the flow of pipeline to import gas from iraq, germany and poleland. another desperate situation in the geopolitical sense right now, not just as far as the gas talks are concerned, but also the situation with russia in the east of ukraine and the relationship with the west. how is this playing out?
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>> it's a very troubling period. we've seen that with the situation in ukraine. obviously the election of a new prime minister in ukraine has made a difference. i think there's a long way to go in that, but it highlights the vulnerable in western ukraine and europe generally to stopping gas supplies. ironically, oil and gas from iraq through turkey was seen as one of the alternatives to open up gas supply to europe. essentially, two things are happening at once. >> would you expect oil price toes be higher based on exactly what you just said there? well, i think your piece suggests most of the oil production is in the south in iraq. so i wouldn't bet carried away. through mosul the oil supplies have been disrupted. i don't think there's an immediate crisis. sometimes the oil market can
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be -- can move on sentiment rather than reality. >> given what you know, the countries are operating right now? >> they've got some natural advances in the north, they're operating in sunni areas, the further they go, they hit much more shia dominated areas. i would be surprised if they get closer to baghdad than they are now. coming up, rolling out the red carpet. china's premier makes its way to windsor castle to meet the queen. we'll have all the dekals coming right up. [ female announcer ] there's a gap out there.
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welcome back to "worldwide exchange." back to the situation in ukraine now. speaking exclusively to cnbc, the ceo of russia conglomerate sistema said the company has not seen any political fallout from the crisis in ukraine. the company is still looking to increase production in russia. >> in terms of -- first of all
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we have a number of opportunities in russia still to increase our production and our nearest target is to get our production level at least to match the refining levels. because our refining capacity is 24 million tons and now production this year will be around 16 million tons. so the nearest target is to bring it to 24 and we can do it pretty much inside of russia without having to go out anywhere significantly. >> now, joining us from the world petroleum congress in moscow salary ex ander corsnet, ceo of bashnet. could i ask weather you agree that right now you've seen no impact on your business from the situation between russia and ukraine and, of course, the sanctions that were applied by some of the western countries? >> it would be wrong to say it's not affected at all. we're affected by a certain
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extent, but only in terms of the course of mining we're getting. but we have sfusht operations which allow us -- so it is not. >> there was a message that you said back in june that the cost of financing is too high to be looking to raise cash. do you feel the same now? >> well, we are not in any discussion for the time being. and hopefully the markets will be stabilized in some not very distant future. >> 2 prospect of an ipo either in moscow or further down the line, there's a perception right now outside of a russian company influence your decision? would you perhaps looking to stay at home in the future
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rather than, perhaps, going to london given that perception? >> there is no formal decision about whether we go to operations or not. but we are getting take a look at that in case the market is trying to make it personal. the performance is pretty good. what is happening in the mngt surround us, performing much better than the market itself. if the market will -- if not, we can postpone it because the major potential is to feel the increase of the shares. some of our inventors prefer more --
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>> on the spur of the moment. can i ask you about the current situation in iraq and how that influences your investment decisions going forward, too, whether it's finance organize it's actually the oil business in particular? and i guess i'm asking not just g geopolitical, of course, but also oil price volatility. >> we have a -- in iraq and we are now preparing to do three which will give us time. but, well, we can always perform for the institutions. we do not have any significant exposure. but, again, where oil is produced, i usually look very stable and very comfortable in places. the rest of the region which you
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are sometimes stable. for the interest in oil prices, where all the prices are going, it's useful for our folks, it's useful for the russian industry, but the situation in iraq comes down and will continue. we hope before we need to spend a significant amount for the stations to be stable. >> alexander, thank you so much for joining us. outside the world petroleum congress, bob dudley commented about the impact on his business. >> i have no special insight as to what's happening today in eastern ukraine. i am not concerned about our 19.75% investment in rosneft and there's no indication of me of
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needing to change any relationship i have with the rossnet board and planning and continuing to work in that role as a member of the board of directors of rosneft. >> in terms of further u.s. sanctions, do you feel the state department is going to put you under pressure to lessen your involvement in russia with rosneft? >> no one has spoken to me about it and it's not something to speculate on. i i can't speculate and shouldn't comment, anyway. >> we spent the first 20 minutes of the show talking about iraq, oil, but we are looking at the stoxx europe 600 up around 0.
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4%. right now, we've still got a number of risk events coming up. we have the fed tomorrow and the decisions and the commentary that we get. that is the focus right now in particular for uk investors, of course. pretty much gains across the board around 5%. let's take a look at the asian session, too, a mixed bag as far as performance. we saw the s&p down 0.2%. we had a more dovish than expected rba minutes out. tedz they're not sure right now that the current stimulus isn't off setting the mining investment and, of course, the government belt tightening, too. we oversaw it going under a bit of pressure, watching the indian rupee, at a two-month low today.
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india, two-thirds of their oil imports need right now. all the geopolitical risk, the risk east keeping some of those risk currency bid right now. but no real big moves right now. a quick check on sterling, of course, ahead of the cpita but we're expecting to get 1 of 6978 level right now. the british gornment announced it would ease access ahead of the premier league. the chinese arrived for a start of a three-day visit to the uk to discuss trade, investment and energy with the prime minister. meanwhile, bp and shell are expected to unveil multibillion dollar agreements with china. steve asked ceo bob dudley about the 20-year deal. >> it's a 20-year supply. it is a big deal. it's l&g of a fair price for
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them, a fair price for us, it's a big deal in terms of a bridge between the uk and china in terms of trade. >> sri, we're obviously very interested in chinese inward investment. david cameron is very excited about that. his comments about human rights potentially to derail that investment before it's done. >> it's a very good point, julia. you cannot ignore the politics. it is over-shadowing this year $30 billion of trade deals that can be finalized when all of these meetings wrap up. and it hasn't been without controversy. we spoke about those comments from deputy prime minister nick colleges. the chinese hate being lectured to on human rights. let's not forget that.
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there are three ts that you just do not talk about in polite chinese society, political circles, as well. tibet, tiananmen and you could bet the deputy prime minister has crossed those lines. is it going to jeopardize these trade deals? i would say no. you've got to realize that they're almost 200 private companies that are represented in this trade delegation. and that is not including the state owned enterprises. so you have to look at the caliber of the companies and the business leaders represented here. ite interesting from the banking sector, icbc, some very big names. and remember that london wants to away global hub for the renminbi trade and it's trying to posit itself in that direction. so we should get more clarity on that front. so at the end of the day, link diplomacy will run its course,
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there will probably be a lot of closed door discussions by the diplomates on either side, trying to smooth the way and trying to smooth any ruffled feathers. >> sri, i have to ask, never mind the business whab do the chinese premier and the queen have in common? there's a bit of a dichotomy there, too, isn't there? surely. >> the they will be meeting later today. you have to ask yourself this, really. china is still a communist country and they're consorting with imperialists no less. >> how to be loved for over 80 years, i'm sure he would like to learn that. thank you. we'll talk to you later on in the show. meanwhile, hong kong shares have been placed on investment. china's foreign direct investment fell by over 6% in may. that's the largest seen since january last year.
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the weak yuan may have kept companies from plowing more monies into the mainland. rebalancing in action, i think, in the fdi numbers, too. shares of chinese casino operators fell in hong kong after macau reduced the number of days people can stay in the city on transit visas. with china under the new government has been clamping down on lavish spending as part of an anti-corruption drive. panels looking set to legalize gambling, allowing casinos in the country. but the passage of the bill is not expected until later in the year. companies including malco crown are vying to win the first
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licenses to operate casinos in the market that clsa estimates could again around around $40 billion annually. still to come, data released right after the break. stay tuned for thob numbers as soon as they hit the wires.
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welcome back to "worldwide exchange." the international energy agency lowers its outlook for iraqi oil production. this as violence spreads and the ceo of bp tells us he's not worried about the company's operation necessary iraq. >> bp's asset res down in the south, down near the would you wait border. they're a long way from the trouble of production being increased in response to the requested by the government. they continue to operate. >> bp and shell are set to win big deals with china as the premier is preparing for a uk visit. shares fall as siemens and mitsubishi launch their deals for the takeovers of the firm.
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the ceos prepare to meet in the next 30 minutes or so. and another recall for gm. they take another 3.5 million cars off the road for faulty ignition switches. we're going to be bringing you the latest uk inflation data and uk sales data. while we're waiting for that to come out, we're going to introduce david owen. we're hearing that the data is out, david. so before you take a breath this week, i'll introduce this data. we've got core cpi at 1.7 year on year. let's see where that's come out. we haven't actually got that data out right now. as we look at the rpi data, plus 0.1% on the market. that's 2.4% plus on the year. slightly higher at 0.2% on the month. so a touch weaker on the rpi reading right now. we're still waiting for the cpi numbers right now.
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actually, they're just coming through. so uk may cpi minus 0.1% month on month. plus 1.5% year on year. of course, it was forecast at 1.7% year on year. that's the lowest since october 2007. the core cpi unchanged month on month. 1.6% year on year right now. and if we take a look at the oil goods number, plus the year on year services at 2.2% year on year, too. interesting, david. so reintroduce this. >> yeah. the bank of england back in may, we're going for 1.8 inflation rate on average in the second quarter. now make in the one-eight in april. so this is a big theme. also, in germany, the unemployment rate was at 5.2 and in some regions in germany, you have unemployment outlook, the inflation there is 1.6%.
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>> and, of course, carney's comments last week and people now trying to decide whether or not they're going to raise rates or at least predict when they're going the start raising rates. where does this leave us? you see you're unsurprised by what carney did because at some point you have to start indicating to consumers that rates are going to go up. >> absolutely. imagine the chance that the government gets, it's pretty obvious that at some point over the next 12 to 18 months uk rates could rise. the important thing, obviously, is people in the wider economy at some point interest rates are going to rise. rates will venltly rise back to normal. >> as far as the markets are
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concerned, the rates are going to rise. that was a question that they were asking. >> well, it's always possible rates go up in the third quarter. what problems would you put on that, inflation at 1.5%? you have have to look at september, are they going to raise rates around that date? february of next year, may of next year, and dealing with november. >> but, you know, earlier, particularly given that you've got, you know, 1.5% inflation at the moment. >> a little bit more rooms, perhaps suggesting that it could come in the fourth quarter. >> mark carney, a sense they can keep warm and also to finish their expectations. but at the end of the day, they'll be interested to see what happens. it's quite good. currency goes up. slight tightening bias, anyway. we can leave rates on hold for perhaps even longer. but the other key thing today, you have the meeting and this is
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key. a lot of people in the oil market haven't gotten their heads around the importance of the committee meeting. george osborne has given them the green light to take it up on equity ratios. so at the end of the day, we'll see something coming out of that and the we have three new members of the mpc. >> so three new members, the bank of england demand and given what we've heard from carney, perhaps acknowledging that perhaps the rates needs to be higher as far as the market is concerned, is there anything as far as the markets are concerned? >> well, we even heard suggestions thinking there can be a three-six split. we don't see a thing in the scenario. obviously, it could mark and move to vote for ratewise.
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there's another uncertainty. >> david owen, thank you so much. let's take a quick look at how the european equity markets are trading. losses between 0.3% across the board yesterday. in particular, in the italian and the german markets right now, it's going to be key. we've got the new survey data out for 10:00 a.m. london time. foreign exchange rates, too, this morning. obviously we've got the geopolitical risk, we've got the fed foam. that's a key risk from the market right now. major support to think about. we're seeing the dollar relative to exported right no in europe and sterling right now. let's bring you up to speed with our top story today. american troops are going back
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into iraq. the white house announced it's deploying up to 275 personnel to supply security to the embassy in baghdad and other u.s. interests in the country. the iraqi military has so far continued to push back towards the sunnis. on this channel, the chief executive of bp bob dudley reported on risks to the company's operations in iraq. >> bp's assets are down in the south, near basra, a long way from the production being increased in response to requested by the government. we are, of course, very vigilant. we have removed nonessential production staff out of there and have continued to operate. >> yusef is in dubai. how are some of the other cups in the region reacting to the news that the u.s. is putting even a small amount of troops on
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the ground now in iraq. you also had the saudis yesterday saying they didn't want to see any u.s. involvement in iraq. >> absolutely. it placed the blame nor the crisis firmly in the hands of the iraqi central government. what we've heard from the qatar reform mip sister. but the comments from the regional and economic kingpin as part of the world are very different from what we've heard from the iranian leadership. the iranian deputy foreign minister basically rejected and said there were no negotiations under way over mutual conversations in iraq with the united states and said that they would do whatever is necessary to assist the central government of iraq. and that shows you that you have two factions on opposite poles.
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that is what we've been seek speaking about in the various factions in iraq. now they're rebounding to the up side roughly about 11%. we're sealing some selling pressures in other markets. saline told me earlier this morning that yes, there was concern about a wider risk of elevation in the violence in iraq even though it wouldn't affect necessarily this part of the world. but it would affect investor sentiment. these are companies, dubai especially that it's seeking foreign imports. that shakes it up a little bit. we'll keep a close eye on the story as it evolves. >> obviously, there's a lot surrounding situations in iraq.
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but speaking to the uk ambassador sir william peyton this morning and he said the only solution that will be found here is a domestic solution, outside interference won't work. would you agree with that? >> well, that is the feedback we're getting from the analysts and experts that i've been speaking to, as well, who made it clear that foreign intervention would just make everything a lot more complicated. you can see that iran is supporting its ally in baghdad under prime minister nuri al maliki. you've heard from the golf cooperation council which is a sunni majority region and has in the public discourse described the situation in iraq as an uprising, as a revolution by sunni group. they have not painted this story as a story of isis and extremist radical fighters. this is a story of suppressed sunnis rising up against a government that would not listen
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to this. a solution needs to be a dmift can resolution or you get everything from one table to another. so the other powers, as well, like qatar, but doing that is much easier said than done and at moment the iraqs are so interested in fighting some argue there's little hope of bringing them back to the table. >> where is the leadership.? gas supply toes europe via ukraine is stable today, thisa s day after russia cut off gas supply to the country. around a fifth of the european union's natural gas supply by ukraine is europe is contractually obligated to allow it to run through europe.
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the company is working to reverse the flow of pipelines that can import gas from poland and germany. there is concern over the oil prices have been driven to a nine-month high. now, earlier in moscow, steve sedgwick had a chance to ask about the prices. >> so far, there hasn't been any big impact besides the drop in our stock price in march and april which has recovered almost -- well, by now entirely
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in january before the crisis actually started. also, there is a lot of talk about worsening of credit with conditions and the ability of russian companies to raise western debt. and this is still a question as to how much it will or will not be a truce. and i think in a few months we'll see depending on how the russian companies -- the first one is off. i think the book had been -- pretty much. so that's an indication. so the financing side, do you have concerns that that is the biggest ramification we're seeing at the moment? not official sanctions, but implicit sanctions with companies pulling back a little bit of their access capital for russian companies? that's probably the big et effect? >> yeah. i think they've increased their perception of russian risk.
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kind of a black swan if everything collapses. they will not be able to recover the debt because the response of the government in the worst case scenario is no one can predict what it will or will not be. so those risks get taken into account. or the way it is perceived going up. >> that's about been any counterparty issues? >> no, no. >> in terms of the gravity of space, you said in the coming months we'll see. do you fear that given the events today, the events regarding the gas talks between gazprom and natural gas, do you feel this is going to be elongated? >> it could be. i think it depends on the
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ukrainian economy shooting up in the future. political situation and changes is one thing. but the economy is something entirely different. but there are fundamental issues that need to be solved, included all the social gaushts that the population used to get was going to happen. are the gas prices going to be subsidized or not going further? at least what the politicians have been saying, probably not. but then, you know, again, how is economy is going to generate cash, so on and so forth. and that is, of course, the gas situation. whatever you consume, gas or oil or any form of energy, you have to pay for it nonetheless and you have to get the money somewhere to pay for this. it's not only a gas issue.
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it's an economic issue. >> time for my favorite segment of the day. germans took the lead after a score from thomas muller. they doubled their advantage with a powerful ed hadder from defender matt smith. controversy struck shortly before avenue time when pepe was sent off for an aggressive gesture. germany took advantage and would score again before halftime. muller completed the hat trick before the 4-0 win. now usa made history with dempsey scoring the attorney many's fastest ever goal after just 29 seconds.
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sustained pressure finally paid off in the 82nd minute with andre smashing the ball past tim howard. the usa's john brooks headed in a dramatic late winner for 81 wins. you can see it there. there we go. now, today's big game is at 9:00 and the host, brazil, gets to build on a strong start as they face mexico. belgium takes on algeria at 1800 ceo. timely, russia will take on south korea in the day's final match. i'm not sure if the host can ov overcome its game today. real really? the turtle has given his prediction. he sig foyed a draw.
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he then went on to eat the fish under the sought korean flag. or maybe he should just really hungry, maybe. still to come on the show, the brics, e-commerce market expected to grow next year? it's all about shopping. more after the break.
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seempens and mitsubishi has offered a takeover bid for alstom. stephane is in paris while annette is in frankfurt. let's start with you, annette. my understanding is this deal would be reportedly worth $1 billion or more than the current ge offer and the matched as far as job currencies are concerned. is that your take, too? >> yeah, that's pretty much my take and the analyst take.
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if you look at the offer, they're saying it's attractive for both players, for alstom, siemens and mitsubishi. so they're proposing an allowance for the bulk of alstrom, they will remain listed as a big company, will remain as a big player and siemens are saying that the gas service business should be headquartered in france. of course, as you were saying, julia, they are pledging to create more than 1,000 jobs during the course of the next three years and also they are saying that they are -- there is job security for those assets if the bit goes through.
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it's interesting in major joint ventures with alstrom. they would like to have a joint venture by acquiring 40% of alstom's steam and nuclear business, 20% of the grid and 20% of the hydrobusiness, essentially putting also and injecting a lot of catch in it. so all in all, it's quite an attractive deal. >> sthanks so much. let's get to stephane now. this is what the french were looking for. are they looking for ge to come back with something better?
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>> you're absolutely right. they said they would prefer an alliance. according to preference media reports, the government could buy a staid stake in alstom, a 5% to 10% stake in order to support the deal. siemens is offering to transfer its rail activity to alstom once the deal is completed in the power sector and siemens would become a major shareholder of this european rail champion. that is something that was defended french economy mip sister. last but not least, what about the job protections in france? you know it is going be a key issue for the government. siemens is offering more or less what general elect promised so far.
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so it's probably on that point that the french government will try to negotiate. probably this is what's going to make the difference at the end of the day. the final decision belongs to the decision between ge and siemens by june 23rd. this is the deadline set by general electric. although the french government has the power so block the deal for specific reasons. >> final decision lies with alstrom, does it? reuters reported that they had
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hooird takeover approaches after a wave of deals in the sector. so online shopping is expected to jump 50% by 2016 according to the world panel and asia will lead that boom for world growth come at the expense of brick and mortar stores? johning us now, jon from cantar world panel. john, thank you for being here. >> thank you. >> e-commerce grows around $53 billion worth of trading in less than two years. how sustainable is that? we're talking about, what, 5% of the overall market? >> it's 5% of the overall market, but in different countries, we've seen quite a different profile. in korea, it's as much as 10%. and that's largely down to the penetration of people who are shopping. so there are different dynamics were we're in different
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countries driving that. people adopt the technology and graph tart more towards online shopping. >> uk consumers spend five times more online than in stores. >> yes. >> why is the uk different? >> it's an average over the year. and la is largely down to the fact that the off-line shop is a combination of different technicians. a big shop combining those on afternoon, when you do it online, it will average out much more. but still only once a month. how are the countries learning? because if the uk is managing to get so much of the business online, are other countries mimicking to a certain extent what is uk is doing? >> there is some mimicking going on. initially, countries are pioneering trying to compete
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with themselves. france, they order online and drive through to pick up your shopping at a particular designation and then you drive on home that's only been around for a couple of years, but already worry seeing man fastations of it considering where you order it, where you pay for it and where you conceive it. particularly in the uk, we are seeing different behaviors emerging. >> we have to take a quick break, john. thank you so much for joining us, director of retail at kantar. next on "worldwide exchange," will merkel be celebrating? that's right after the break. and if i tap my geico app here i can pay my bill.
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welcome back to "worldwide exchange." i'm julie chatterley. the iea warns about iraqi oil. >> bp's assets are down in the south. they're a long way from the troubled productions being increased in response by requests from the government. we've continued to operate and haven't missed a beat.
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>> another recall for gm. the troubled automaker takes another 3.5 million cars off the road for faulty ignition switches. bp and big deals with china. the oil majors expected to unveil multibillion pound deals to supply gas to china. and siemens and mitsubishi launch their takeover proposal for alstom, rival bids for siemens and mitsubishi. more in the next half hour. >> announcer: you're watching "worldwide exchange," bringing you business news from around the globe. >> so we're waiting for the latest german news survey data. and we've got current conditions coming in at 67.7 versus 62.1 in may. the expect azs were for it to
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drop to 53 been so it's significantly better than expected. we've got the economic expectations coming in at 29.8, that versus 33.1 in may. so a slight slip on the number there. and, of course, for the economic expect ages, the forecast there was 35. so actually it's going the opposite as far as the current expectations and results are versus the economic expectations. saying the german economy is currently in very good shape and further increases in the german economy are becoming more difficult. there are signs the second quarter growth will be weaker than q1. let's get straight to phillip, chief economist at investec. what are your thoughts? >> this is the way it's gone over the past couple of months. the sentiment numbers have weakened. the current conditions have remained strong. so no huge reversals and trends. markets tend to like to look at the sentiment numbers as we can
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get market reaction more on that side of the survey. and it's not much different, if anything, it's up stronger because of the rise in the current components. as far as one does use it to gauge the german economy, this isn't a bad outcome. >> how do you take the point that he says, look, the situation as far as the german economy is furthermore pushing out of this economy is actually different? >> well, it is difficult because the german export economy and china as we know has slowed down somewhat. of course, we've got had a huge pick up in the eurozone economy. it shouldn't be forgotten that it's a very important destination for the german industry, as well. until we get more of a convincing new year's end economy, i think that situation is going to remain. >> let's talk about the fed, of course, who has their meeting tomorrow. there's an expectation out there that the surprise could be more on the dovish side if yellen
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allows the current market pricing, the more dovish market pricing to we maintained. what are your thoughts? i'm not sure about that. the fed on the qe is on auto pilot. and you really need a massive surprise in the economic numbers one way or another to deflect the fed from its current 10 billion tapering every meeting. i think what possibly is more important is what comes in the statement, the assessment of the economy. clearly what we've had is a rebound in the demand numbers following the winter freeze. some questions about housing market, the survey yesterday was pretty well supported. don't forget, too, that when we're talking six to nine months ago, the low inflation numbers were an issue with the fed. that's not so much the case now with the headlines cpi at 2% and we'll find out a bit later on today how that's done.
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so i think we are now trying to guess where it's likely to tighten. >> you can't escape the fact, though, that if you look at where the fund is scheduled, she tells us not to focus. so there is a discount there. that is dovish from yellen today. >> i think in terms of any intautive comments at the meeting, the press conference is likely to reinforce the nature of the recovery. there seems to be still a very mixed message coming from fomc members. .you do need some goidance not only from markets, but on the committee, as well. i think it is look at the
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economy and i think the fed is going to talk more about the economy than it is the drop in the yield curve. >> interesting. thank you so much. american troops are going back to iraq. the white house announced its deploying up to 275 military personnel to provide security to the embassy in baghdad and other u.s. interests in the country. the iraqi military have so far managed to curtail the sunni rebels push towards baghdad with insurgents appearing to concentrate on consolidating their strong hold on the move west of the country. 275 u.s. troops to baghdad, of course, is a real focus right now for those in the region. michelle caruso cabrera will have the latest on the uprising in iraq as the white house considers the next move. she's live from northeastern
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iraq in the kurdish region just 50 miles east of mosul where isis took control last week. we will be speaking to her later on, of course, in the programming. now, the u.s. says it's open to talks with iran over what measures it can take to stop isis in iraq. u.s. secretary of state john kerry said discussions did not include military cooperation. >> we're open to discussions if there's something constructive that can be contributed by iran, if iran is prepared to do something that is going to respect the sovereignty and integrity of iraq and the ability of the government to reform. >> baghdad is now appraising for conflict as the militants approach iraq, the capital. richard engle filed this report from baghdad. >> reporter: these iraqi soldiers, prisoners of isis in a
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video not verified by nbc news are being forced to swear aleaguance to the -- >> one refuses and is executesed. the others agreed, but they, too, were later found dead. they are getting stronger, joined by supporters of saddam husain and sunni tribal leaders. in mosul, they marched together on their way to hang an iraqi soldier. this weekend, the militants released pictures of dozens of iraqi soldiers being led to their death. and the iraqi army is now fighting back with air strikes and thousands of new recruits. but the insurgents have their sights on baghdad. and if they can't get to it, they may try to send in suicide bombers instead. it is strange to come back to baghdad and see it likes this. this is normally the busiest market in the city. today all of the shops are
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closed and this street is normally full of troofk. today, hardly anything and there are gunmen on every corner. some are soldiers, many are shiite militiamen responding to a call to fight from their leaders. we did find one shop open within a grocery. he thinks the isis radicals aren't strong enough to enter baghdad now. instead, he expects car bombs. people are afraid, he says. we expect bombings will come at any moment. this is perhaps the most iconic place in baghdad. there used to be a giant statue of saddam husain right on top of that pedestal until u.s. marines came down the street, the statue came down and saddam's country may be at a cruel time.
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>> bracing for a new round of sectarian war, perhaps the worst this country has ever seen. >> some comments from morning, circumstances are right to reopen a british embassy in iran, this is following comments made in the last 24 hours saying he's making moves to strengthen british diplomatic ties with iran in an attempt to fashion the joint response. that doesn't mirror the comments we've had from john kerry and the comments on the cry sit itself. >> bp's assets are down in the south, near basra, down near the kuwait border. they're a long way from production being increased in response by the government. it's a long way. we are, of course, very vigilant. we have removed nonessential
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production staff out of there. we continue to operate and having miss add beat so far. >> phillip, your take on the iraqi situation right now as far as markets are concerned? because if we turned to the u.s. session yesterday, they seemed to lift towards the end of the trading session, almost shrugging off the noise we had earlier in the session. >> looking at markets and, of course, what markets want to see is, as mr. dudley was saying, a continuation of oil sprys. there is a risk that if the violence continues to intensify, then you get some path of the world's recovery under threat. >> but yesterday, u.s. fundamentals and better data lifted the markets and offset some of the geopolitical concerns right now. can we get back to fundamentals since they actually -- if we see better data, if we get a more
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deafish yellen perhaps stoem, that will lift the market and offset some of the concerns about geopolitical tensions. >> yeah. i think that's probably the case. yesterday, arguably the key piece of days what the survey. to dispacing concerns about the market, ukraine is a flash point and we had the issues in argentina, as well. thank you so much for sharing the information today. will a shrugging off of the iraqi crisis carry on in the united states? we'll check after the markets coming up right after the praek. stay with us.
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these are your headlines. the u.s. is sending troops back into iraq. general motors recalling 4 million more cars for ignition switch problems. and while they may make concessions in its bid to buy alstom, mitsubishi and siemens launch their counteroffer.
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u.s. futures indicating slightly higher. you've got the s&p 500 higher by around 4 points, dow jones higher around 45 points and nasdaq managing to end slightly higher for the second straight session yesterday, of course. manufacturing output, cpi on the agenda today. expected to stay at 2% year on year in may. we've got housing starts to focus, too, and the european market uk insaying. wow, lowest level since october 2019. minus 0.1% month on month. concerns about when and how the uk are going to be raising rates after mark carney's conversations about it. we've got survey data out of dpermny, too, coming in better than expected on the current conditions. concerning comments from the chief economist says after a strong q1, germany could see a
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slowdown in q2 and that expectations or current conditions right now do show germany in good shape. but it has taken the german markets slightly off the board in the last few minutes in particular. in corporate news, gm is recalling another 3.4 million cars for faulty ignition switches. the company will fix or replace keys that could cause the switch to move out of the run position if they're too heavy. that could lead to engines shutting off, the power steering to be disabled and drivers to lose control. the recall affects models from 2000 to 2014. the defect has been linked to eight crashes, but no deaths. it's recalling 166,000 vehicles for other issues and is raising its second quarter charge for recall class to $700 million. in a session over in germany, up 1.5%, down just over 11%.
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new jersey state assembly has passed a deal lawingmakers of zero emission cars such as tesla to bypass car dealerships and sell directly to customers. the electric carmaker was forced to convert its two new jersey though rooms into galleries where buyers could look at models, but couldn't talk price or place an order. apple has reached a class action settlement over ebook prices according to a filing with the new york court on monday. the exact terms of a settlement are under seal and need to be approved by the judge. the plaintiffs argue apple overcharged consumers for ebooks by $280 million. the settlement is contingent
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problem last your's anti-trust ruling. apple's price performance, higher by around .9%. so it's outperforming the broader sector. a quick update on last night's world cup soccer action. germany defeated portugal, 4-0. nigeria housed the competition's first goalless game. and a spirited ghana side lost 2- 1 to the usa. the usa scored the fastest ever goal in the tournament's history, that coming after just 29 seconds. take a look at how the new
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york post reported the united states win on their backstage, red, white and blue-tiful. the next game is at 9:00 cet as brazil faces mexico. today, teal bem gum take on siberia. also russia will face south korea in the day's last match. coming up, the chinese premier visits the queen. more on that after the break.
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the senate subcommittee on investigations is holding a hearing today on high speed trading and whetherite harming investors. lawmakers are probing whether fees and payments to stop brokers by exchanges and other trading venues are influencing how they treat customer orders. among those testifying today, new nyse ceo thomas farley and the ief ceo who was featured prominently in the book "flash boys." a new report by giving usa
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shows charitable giving hit an all-time record in 2013. $331.5 billion. giving by companies fell around 2%. large gifts of $80 million or more, the report says giving lagging gains in the stock market and overall inching gains by the wealthy. now, the british government announced it would ease visa access for chinese visitors ahead of premier league arrival at the airport yesterday afternoon. it's the start of a three-day visit to the uk where mr. lee is expected to discuss trade, investment and energy with prime minister david cameron. meanwhile, bp and shell aren't expected to unveil multibillion dollar agreements with china.
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>> it's a 20-year supply with cnok and southeast china. it is a big deal. l&g of those sort of magnitudes, fair price for them, fair price for us, it's a good deal, it's a good bridge between china and the uk. >> raj is outside 10 downing street. just give us a flare of where else china could be training its sites. >> well, the politics is really over-shadowing this three-day trade meeting. and you really cannot escape it. just barely 200 yards away from our position here in downing street. there is a fairley sizable coalition of protesters and they are representative of t. it's a stark reminder, really, of the pressures that china has
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been earn, the human rights record, it's a very stark release by the deputy prime minister when he talked about china being shackled to communist doctrine. he said china is guilty of systemic human rights abuses. i asked some of the protesters outside downing street whether david cameron would bring up human rights, whether they were on the agenda during these trade talkes and they seem to be quite confident. in fact, they applauded those comments from the deputy prime minister not so long ago. they see there is momentum behind the whole issue of human rights. but the big question is whether it will undermine the dialogue and undermine any of the trade deals that are going to be finalized and signed some $30 billion worth of them. we'll get more clout in later on today. still to come on this show,
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raising the roof. how funding has taken off on the real estate sector, come up next. [ female announcer ] there's a gap out there. that's keeping you from the healthcare you deserve. at humana, we believe if healthcare changes, if it becomes simpler... if frustration and paperwork decrease... if grandparents get to live at home instead of in a home... the gap begins to close. so let's simplify things. let's close the gap between people and care. ♪ let's close the gap between people and care. [ male announcer ] it's one of the most amazing things we build and it doesn't even fly. we build it in classrooms and exhibit halls, mentoring tomorrow's innovators. we build it raising roofs, preserving habitats and serving america's veterans. every day, thousands of boeing volunteers help make their communities the best they can be.
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welcome to "worldwide exchange." i'm julia chatterley and these are your headlines. the ibtser national energy agency lowers its outlook for
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iraqi oil production as violence spreads. but the ceo of bp tellses he's not worried about the company's operations in the country. >> bp's assets are down in the south near basra, down near the kuwait border. they're a long way from the trouble of productions being increased in response to requests by the government. we continue to operate and having missed a beat. >> another recall for gm, the troubled automaker takes another 3.5 million cars off the road for faulty ignition switches. bp and shell set to win big deals with china, tifrt premier league touches dour down for a uk visit. the oilmaker is expected to unveil multibillion dollar deals to launch with china. siemens set to hold a press conference on the issue of a bid for alstom.
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sfla you're watching "worldwide exchange," bringing you business news from around the globe. if you're just tuning in, thanks for joining us here on "worldwide exchange." stocks are going to eek out a second session of gains yesterday. we seem to be adding to the positive momentum indicating higher for the future. we've got the dow higher by, what, some 44 points. we have the s&p 500 higher by 4.5 and the nasdaq around 10 points higher. u.s. cpi in focus today expected to stay around that 2% year on year figure in may. we've got housing starts. yesterday the business confidence, the home builder confidence and the manufacturing output lending some support to these markets. let's take you through the european session this morning to obviously geopolitical concerns in iraq, russia and ukraine still very much at the forefront of investors minds as we head towards the fomc meeting. right now, we have uk cpi from the uk, the lowest level since
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october 2009, perhaps reducing some of those concerns about when mark carney is going to raise rates here. we've got gains in the german and french markets, higher by around 0.4 had%. with all the things going on in the markets right now, the geopolitical risk, the gains, how do you make money? here is what some have been telling us this morning. >> we've been seeing in turkey, for example, that investors have been flocking into these markets after the elections at the end of march. there's been a large -- in the market about rebalancing and improving current account in turkey. the oil prices will quickly suffer that trend. >> oil, on the worldwide -- and gdp. it's a real player. it will be very interesting to see how that is reflected and, of course, what happens with
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respectability. it's a real player. >> it's a worrying sign that the level of volatility has said investors are starting to get slightly complacent. and if there's an area of earnings, so it's a reasonable affect. in terms of the overall valuation, there's still a reasonable value against bonds. >> that begins a two-day policy meeting today. the announcement through wednesday, at 2:00 p.m. eastern. and along with fed member's economic forecasts and we followed, of course, by janet yellen's press conference at 2:30 p.m. the central bank is widely expected to taper its bond purchases by another $10 billion. the forecasts slower, u.s. growth this year after gdp shrank 1% in the first quarter.
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but falling unemployment and rising inflation could prompt the fed to project a slightly more rapid rise in interest rates. the fed is reportedly considering exit fees on bond funds to avoid a potential run on the $10 trillion corporate bond market. the fm sometimes says officials are concerned investors could pull their money. even though the asset are a long-term debt. their claims could be less liquid making a fire sale less likely. these would require a rule changes by the s.e.c. let's give you a look at what else is on today's agenda in the united states. as i mentioned earlier, the may cpi is out at 8:30 a.m. eastern. com consumer prices are forecast to rise 0.2% on the month. also at 8:30, we get may housing starts, which are expected to drop by 3.7% to an annual rate of 1.03 million while building
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permits are seen falling by nearly 2%. adobe systems reporting results after the closing bell today. so one to watch there. american troops are going back into iraq. the white house announced it's deploying up to 275 military personnel to provide security to the embassy in baghdad and the rest in the country. the iraqi military so far managed to curtail the sunni rebels while concentrating on consolidating their strong hold on the northwest of the country. baghdad is bracing for conflict as sunni mill at that points approach the iraqi capital. richard engle reports from baghdad. >> these are iraqi soldiers in a video not verified by nbc news are being forced to swear
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allegiance to the al qaeda o offshoot that overran their position. one refuses and is executed. the others agreed, but they, too, were later found dead. they are getting stronger, joined by supporters of saddam husain and sunni tribal leaders. in mosul, they marched together on their way to hang an iraqi soldier. this weekend, the militant eggs released pictures of dozens of iraqi soldiers being led to their deaths. the iraqi aurm is now fighting back with air strikes and thousands of new recruits. but the insurgents have their sites on baghdad. if they can't get to it, they may try to send in suicide bombers instead. it is strike to come back to baghdad and see it like this. this is normally the busiest market in the city. today, all of the shops are closed and this street is normally full of traffic. today, hardly anything.
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and there are gunmen on every corner. some are soldiers. many are shiite militia men respond to go a call to arms from than religious leader. they're ready to defend st the capital and the shiite faith. we did find one shop open, a grocery. he thinks the isis radicals aren't strong enough to enter baghdad now. instead, he expects car bombs. we expect bombings will come at any moment. >> this is perhaps the most iconic place in baghdad, produce square. there used to be a giant statue of saddam husain right on top of that pedestal. iraq was at a turning point then and it may be at a turning point now. >> as evening came, even fewer people around in a city of
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7.million. bracing for a sectarian war, perhaps the largest this city has ever seen. recently, cited partnerships with property.com. it's tough to get data on how much money is being invested right now as a proportion or as funding of a proportion in the real estate sector. can you give me an idea of the amount you're raising right now? >> sure, julia. thanks so much for having me. real estate funding is the sector of equity crowd funding that has taken off. it's been permitted through the new line of 506c.
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it's basically outpacing all of the other sectors by three fold numbers. and we're seeing that continue. essentially, it's not that pricing, investors are chasing yield. there are a number of investors who finally have private access. they're chasing that same yield. so the fundamentals of real estate transactions really match what they're looking for. they've got cash flow, they have return, they have collateral and they have an investment horizon that makes sense for them. so it really is the sector that's working, so far taking off the most in equity cloud funding. >> and what about some of the skepticism out there, the niche market right now and actually for certain investors, it's a regulated market and there's a risk that people could get involved here that don't really understand what they're getting into. >> yeah. so i think that is a fair question. and with every new type of
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capital raising or anything that is really transforming what has been an 80-year tradition of not giving investors direct access to transactions like this through the prohibition of general solicitation, there's always going to be people who are concerned and certainly we have the same concerns in the sense of putting regulation and security and due diligence at the very top of how we build our business. it is of key importance as is education and investor diversification. but we really believe fundamentally that this is going to be the first of a very big transition in how private capital is raised in the united states for companies raising capital. real estate, and others. if you think back to the way online stock trading was 20 years ago, the same kind of players, you're saying this is not going to move online for the actual retail investor, too complicated, too challenging and now we have over 4/trillion of assets sitting in those managed
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accounts. we really believe all other cities have moved themselves online in the last ten years. 506c of the jobs act was kind of that last piece of the puzzle enabling us to move private investing online. we do not believe it was a niche. we believe we are in the very beginning of a big change. >> fantastic to speak to you, joe anna swartz. now, coming up, gm's recall crisis expands as the automaker adds over 3 million more vehicles to the list of those being pulled for safety issues. we'll discuss right after the break.
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these are your headlines. the u.s. is sending troops back into iraq to protect embassy personnel. general motors recalled 3 e million kals for ignition switches. and siemens and mitsubishi launch their counteroffer for alstom. we've had some breaking news out of iraq. foreign staff are being evacuated from iraq's oilry finery. local staff, though, remains. that's according to refinery officials. they're saying the shutdown in operations at that refining due
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to security concerns. there was talk earlier in the week of whether or not the insurgents would try to take this. it looks like right now foreign staff, not local staff, being evacuated right now. now, french president hollande is currently meeting with the ceo of siemens and mitsubishi as the industry battles for alstom intensifies. siemens have mitsubishi have together launched a rival bid for the french company which includes a $7 billion euro amount in cash. this as ge could be looking to offer new concessions to its offer according to the ft. uk drugmaker shire trading higher after reuters reports the firm has hired investment bank citi as a defense adviser against hostile bids. speaking to reuters say shire is expected to testify takeover approaches after a wave of deals in the sector. now, the scope of general motors ignition switch recall
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crisis has more than doubled as the company adds more recalls to the list. >> jackie, it seems to grow by day. >> gm making more headlines, recalling another 3.4 million cars for faulty ignition switches. now, the company will change or replace keys that could leave the switch out of the run position if they're too heavy. that, of course, could cause the engine to shut off, power steering to be disabled and drivers to lose control. gm says it's received reports of eight crashes and six injuries, but no deaths. now, the original ignition switch recall has been linked to at least 13 deaths. gm is recalling 166,000 cars for other issues and raising its second quarter charge for recall related costs to $700 million. this new action affects seven models, although most of them are no longer sold.
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it covers the 2005-2009 buick lacrosse, the 2006-2014 chevy impala, the 2000-2005 cadillac deville and the 2004-2011 cadillac dts. it affects the buick lucerne, to 40-205 buick regal and the 2006-2008 chevy monte carlo. a gm spokesman has concerned that former engineer ray de georgeo was the release engineer for the switches in the new recall. recall that he was fired earlier this month after an internal report determined that he played a key role in hiding the defect in that latest recall. this coming as ceo mary barra prepares to testify on capitol hill. now, barra told reporters last
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week that the company is nearing the end of an extensive review of safety data, warning that there could be more recalls by the end of the month. so far, gm sales haven't been hurt by the recalls. checking shares of gm today, we're seeing them up about 1.5%. to answer your question, julia, there could be more down the line. >> thank you. have a good day. new jersey state assembly has passed a bill allowing tesla to sell directly to consumers. lawmakers introduced the bill after tesla was railed against in march. the state senate still needs to approve the bill before it goes to governor chris christie. in weather news, a double tornado has ripped through the
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u.s. state of nebraska, killing at least one person and leaving 16 others in critical condition. half a down has been destroyed according to hospital and emergency officials. elsewhere, evacuation orders have been lifted in california after firefighters managed to contain a mountain wildfire with air tankers and helicopters. the blaze destroyed three houses, damaged others and one forced hundreds to flee hr homes. italy's mt. etna erupted yesterday. wow, good pictures. catalonia airport was closed, but there were no other discorruptions and no injuries were reported. could improving unemployment figures promt a faster rimore right after the break. need to hire fast? female ]
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welcome back to "worldwide exchange." more breaking news now on the situation in iraq. associated press are reporting that the police are saying 44 detainees have died as a sunni group has attacked a jail northeast of baghdad in fight with see eat muslims. we have commentary from the u.n. secretary general ban. he's been urging the iraqi prime minister to reach out to restore peace and stability in the region. we've got comments from iraqi's kurdistan minister. he says plans to reach the iraqi budget allocation by year-end. so they are planning to continue that oil export and reach the iraqi budget allocation by year-end. we'll keep you abreast of any further developments on that.
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we've got some siemens flashes out this morning. we've had a press conference being held right now at the french prime minister, french president, sorry, has a meeting with the ceo of both seemenes and mitsubishi. we're seeing siemens mitsubishi bid alstom at 14.2 billion ur rows he. the talks this morning are the combined bids are worth more than ge's bid. let's take a look past the european markets right now as we see those reports. very little change as far as the european markets on those latest news flashes. we will keep ayou abreast of an further developments. let's take a quick look at the u.s. futures in trading. managing to eek out a second session of minor gains in the second and seemingly adding to that sentiment right now. the s&p 500 higher by just shy of 4 points and for the nasdaq
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11 points higher, too. also to keep investors very much poised, the fed begins a two-day policy meeting today, too. the center bank is widely expected to continue its tapering purchases by another $10 billion a month. the fed may forecast slower growth this year after gdp shrank 1% in the first quarter. the global head of g-10 equity strategy joins me now. it's not so much about when hikes begin. it's actually about when and where they end. talk us through your thoughts. >> good morning, julia. i think the fed will be consistent with its previous message on when hikes are going to begin. but since the last meeting, there's been a lot of fed discussion about secular stagnation, about where policy rates are -- what the terminal rate is going to be, where
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long-term yields are going to be. if they lower their long-term trajectory of rates, that would come across as relatively dovish right now. >> so are you saying that you think they could perhaps do that or they won't do that? >> no, they could perhaps do that. it's something that key fed members such as yellen and dudley have emphasized in their talks. so i think that rather than focus on the -- you know, faster than expected short-term drop in the unemployment rates, they'll we more concerned about whether the u.s. economy can keep up the momentum of an extended period. if you're spething to get this dovish comment from yellen, should you be short the dollar? >> well, i think dollar shorts against high yielders are appropriate. that being said, given the iraq
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situation, the dollar is getting the bid as the safe haven. so you have to balance the two. on top of that, we have cpi numbers today where investors will be nervous. we've had a couple of .2 prints to get a 0.3, that would back up the yields. i'd be very careful going into this. >> where does iraq features and the headlines we're getting as far as the concerns. >> the u.s.'s growth of the oil independence, it's one of the least vulnerable positions in the world. you're beginning to see some concerns in emerging markets, concern about, you know, places like china -- sorry, japan. and other asian countries that are big oil importers and you're beginning to see some pressure on p.m. as a result. i think the dollar safe haven trade is the best. >> thanks, steven. agreed to talk to you.
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steve englander. and that's it for today's show. i'm julia chatterley. thanks for watching "worldwide exchange." "squawk box" will be right up.
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good morning and welcome to "squawk box." the crisis in iraq, the pend gone moving more firepower into this region and more troops into baghdad to secure the u.s. embassy. gm's recall crisis continues to grow. the automaker recalling another 3 million cars. and a major feat accomplished in brazil. the united states finally beats ghana in a world cup thriller. it's tuesday, june 17th, 2014. "squawk box" begins right now.
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good morning, everybody. i'm becky quick along with joe kernen and andrew ross sorkin. in iraq, islamic militants took control of another town yesterday. there have been reports of fighting south of baghdad. president obama telling congress that the united states is deploying up to 275 million personnel. they're going to be providing support and security for u.s. personnel in the embassy in baghdad. we will have more from michelle caruso cabrera on the ground. that is coming up in a few minutes. in another region of the world, russia cutting off gas supplies in ukraine after the two countries failed to agree on a payment. and then there are concerns about argentina. the country facing default if it does not repay $1.2 billion by june 30th. the u.s. supreme court ruling out an appealing against critters. u.

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